DAVENPORT, Iowa — The City of Davenport is making progress on a 'tax increment finance,' or TIF agreement, with Fair Oaks Foods.
The Wisconsin-based food company broke ground on a $134 million bacon production facility on Sep. 1. The City offered a $6.4 million TIF agreement to attract Fair Oaks to the Davenport area.
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On Oct. 26, the city hosted a council meeting to decide if a public meeting will be held on the TIF agreement. The City is required by Iowa Code to hold the meeting since the agreement involves the city incurring debt.
"We love to see more folks coming to Davenport, coming to the Quad Cities – it helps the entire community out," Davenport Economic Development Director Bruce Berger said.
The value of the incentive package totals approximate $6,403,000, which includes:
- A forgivable loan of $1,100,000 once an onsite sewage pretreatment facility is completed.
- An estimated $51,000 in cost share for road improvements which the city will seek funding for through the Iowa DOT RISE Grant.
- A tax rebate estimated to total $5,252,000 over 15 years.
Berger explained that TIF agreements attract businesses to use land that would sit empty otherwise.
"If the company didn't come, it would be very little tax revenue generated anyway," Berger said. "By each of us sharing a little bit of the increase in taxable revenue, the company benefits the community, the taxing jurisdictions benefit, and we get an increase in jobs."
TIF agreements can also include improvements in city infrastructure like roads or utilities.
"In this case, they're using a portion of that for their 60% to assist with the sewer pretreatment facility, which will make it easier on our sewer system," Berger said.
He added that similar agreements in the past, such as with Sterilite, have proven successful.
"We've been doing 60% rebate tips for years, and we've had a lot of great successes to point to – so this is just one more," Berger said. "We're really excited to see Fair Oaks come."
When combined with amenities in the Quad Cities, he said he hopes the area continues to be an attractive place for new businesses.
"Benefits that are available already here in our community are I think, a piece of what has helped attract some of these businesses to places around the Quad Cities," Berger said.
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